Cash point

Good news for borrowers as the number of fee-free mortgages has increased to 2,007, up 274 since January.

Now more than a third of deals don’t have any fees – meaning home buyers won’t have to cough up vast sums at the start of their deal, and they’ll be up to £795 better off over a two-year term, according to data from Moneyfacts.co.uk.

The lowest two-year deal for those with 40% deposits is HSBC’s 1.44% with hefty £1,499 fee. That costs £20,560 in total over the term on a £200,000 loan, compared to £19,765 with Sainsbury’s Bank’s 1.7% fee-free deal – £795 less.

Those with lower 10% deposits could save £600 with Yorkshire Building Society’s fee-free 2.01%, compared to Sainsbury’s 1.84% with £995 fee.

Over five-years Skipton Building Society’s 1.83%, with hefty £1,995 fee, costs £51,870 over the term. While Sainsbury’s 2.09% fee-free deal a total £51,389 – saving £481.

Don’t be lured in by the lowest mortgage rate. Ensure you know the total cost so you really do get the best deal for your loan size over the term.

Charlotte Nelson, finance expert at Moneyfacts.co.uk, said: “Getting a mortgage is daunting enough without having to work through the maze of fees.

“However, it is important that borrowers research thoroughly, comparing the true total cost of any deal, so they can be sure to get the most cost-effective option.”